European Officials Vote to Add VAT on Postal Services

Share this content:
Members of the European Parliament voted yesterday for a European Commission proposal that would add value-added taxes to services and stamps sold by state-run postal organizations across state-run postal services in the European Union's 15 countries, according to reports.

Last month, the parliament's economic committee voted against the proposal, which would lift a VAT exemption of state-run postal services that has been in effect since the 1970s. Currently, only private mail firms charge a VAT of up to 25 percent.

With full liberalization of postal services occurring throughout Europe, it has been argued that government postal services have a competitive advantage against privatized companies. In the United Kingdom, for example, with full liberalization occurring in 2007, a private carrier would be required to charge a VAT of 17.5 percent while Royal Mail would charge nothing.

The EC, however, says the move will benefit state-run postal services by letting them deduct the VATs they pay on fuel. Private operators currently are permitted to deduct these costs, but state-run agencies cannot since they do not charge a VAT.

The EU makes the final decision on tax issues. Yet, while the parliament's view is not binding, insiders said yesterday's vote may pave the way for government approval of the directive.


Next Article in Direct Mail

Sign up to our newsletters

Company of the Week

Since 1985, Melissa has helped thousands of companies clean, correct and complete contact data to better target and communicate with their customers. We offer a full spectrum of data quality solutions, including global address, phone, email, and name validation, identify verification - available for batch or real-time processes, in the Cloud or on-premise. Our service bureau provides dedupe, email/phone append and geographic/demographic append services for better targeting and insight. For direct mailers, Melissa offers easy-to-use address management/postal software, list hygiene services and 100s of specialty mailing lists - all with competitive pricing and excellent customer service.

Find out more here »

Career Center

Check out hundreds of exciting professional opportunities available on DMN's Career Center.  
Explore careers in digital marketing, sales, eCommerce, marketing communications, IT, data strategies, and much more. And don't forget to update your resume so employers can contact you privately about job opportunities.

>>Click Here

Relive the 2017 Marketing Hall of Femme

Click the image above